By: Susan Lubejko PhD and Abigail Copeland PhD, Regulatory Affairs Specialists at Mittal Consulting

On Tuesday August 4, the Centers for Medicare & Medicaid Services (CMS) finalized the repeal of the alternative pathway for FDA-designated Breakthrough Devices to access the new technology add-on payment (NTAP) and transitional pass-through (TPT) programs. Over the past five years, the alternative pathway for NTAP and TPT supported more favorable access for devices that received FDA’s Breakthrough Device Designation (BDD) to receive a potential supplemental payment during the early years of commercialization. This announcement is a blow to Sponsors developing innovative medical devices who were eager to leverage breakthrough status for NTAP/TPT access to ease the reimbursement hurdle in the crucial years immediately following FDA authorization.

The NTAP/TPT programs are temporary Medicare reimbursement programs that provide payments to inpatient (NTAP) and outpatient (TPT) settings adopting innovative new device technologies that have not yet received Medicare coverage. These payments encourage the use of innovative technologies in the typical 5–7-year gap between FDA authorization and Medicare coverage (Sexton, et al. 2023). Since 2021, medical devices awarded FDA BDD received access to NTAP/TPT payments upon proper application by leveraging their Breakthrough designation to satisfy the NTAP/TPT substantial clinical improvement (SCI) criterion where manufacturers must demonstrate that their device substantially improves upon treatment and outcomes over what is currently covered for Medicare beneficiaries. After the repeal of this alternative pathway goes into effect in October 2026, the NTAP and TPT programs will still be available; however, breakthrough devices will have to fulfill all the same requirements expected from devices applying to the traditional NTAP and TPT pathways, including SCI, the most rigorous hurdle faced by applicants. The previous relaxation of the SCI requirement for breakthrough devices was crucially important: breakthrough devices are novel and therefore may not have as much evidence backing their substantial clinical improvement. Novel devices are also often more expensive to produce and use in their early commercial years, making the easier access to NTAP and TPT pivotal in initial commercial adoption. This new SCI burden removes significant appeal for Breakthrough designation and is likely to negatively impact innovation in coming years as novel devices are stuck in the uncertain coverage process, often called the Reimbursement Valley of Death.

The next replacement reimbursement scheme is called RAPID, a recently announced program from FDA and CMS that will provide some reimbursement advantages to certain eligible Breakthrough devices. RAPID allows sponsors to engage in conversations with both FDA and CMS during device development with the goal of generating clinical evidence that supports concurrent regulatory approval and a national coverage determination for reimbursement. However, eligibility for RAPID is significantly more limited than the NTAP/TPT alternative pathway – it is only open to Breakthrough devices that are collecting clinical data under an Investigational Device Exemption (IDE) that enrolls Medicare beneficiaries and it is predicted that the program enrollment will be quite small with likely less than 10 enrollees to start. For further details on RAPID, read our full analysis in the April 29, 2026 edition of On the Reg.

For Sponsors of current Breakthrough devices that are still interested in NTAP/TPT payments, a transition period is in place before the alternative pathway ends for good. Current Breakthrough devices and devices which receive Breakthrough by September 30, 2026, will be eligible to apply for NTAP/TPT payments for the next several years. For NTAP, Breakthrough devices receiving FDA authorization by May 1, 2028 for their breakthrough indication will be eligible through FY2029. For TPT, Breakthrough devices receiving FDA authorization for their breakthrough indication will be eligible through January 1, 2029. Unfortunately for Sponsors currently drafting a Breakthrough application, the September 30^th approval deadline makes it unlikely that any new applications not already under FDA’s review will be approved in time to be eligible for the NTAP/TPT alternative pathway transition period. Ultimately with these changes to the MedTech reimbursement landscape, all Sponsors are encouraged all the more to think critically about their reimbursement strategy early and often, as reimbursement planning during early regulatory stages is now more crucial than ever.